Cantor to Reid: Call the Senate back to address the payroll tax cut

posted at 6:05 pm on December 20, 2011 by Tina Korbe

House Majority Leader Rep. Eric Cantor took a recent interview on Bloomberg television as an opportunity to spin the House’s rejection of the Senate payroll-tax-cut bill.

“Honestly, the papers, the bill, is back in to the Senate now,” Cantor said. “We have acted in the House, rejected the 60-day extension and said we want a year. So the Senate will now have to act. If the taxes expire on Harry Reid’s watch, he will have to answer to the people. Again, I would ask, what does Harry Reid have in for the middle class? We want to be there to help the middle class and working people of this country with certainty. That is what the president wants and that is what we want. We should go ahead and accomplish that prior to the end of the year.”

He explicitly invited Reid to recall the Senate to business. “I would urge Harry Reid to come back to town, appoint conferees, and let’s get this going,” he said.

Cantor’s ability to hew to the Republican line in this case is admirable and impressive. I just can’t do it. The payroll tax cut debate has given me a severe case of whiplash. Indulge me as I now try to straighten out the details.

To hear House Republicans talk about it now, you’d think they had proposed and championed a yearlong extension of the payroll tax cut from Day 1. Actually, the president proposed and championed it. Republicans, sensibly, opposed it as bad policy. Yes, that put them on thin ice politically because the majority of the American people liked (and still like) the idea of a payroll tax cut extension. But legitimate objections to the extension could be made — and still can. Ed puts it perfectly:

The cut in revenue to the Social Security fund expands the already-significant deficit between revenues and benefit payments in SSA, which means that more money has to come out of the general fund to cover the gap — and that means more deficit spending. That might make sense if the cut produced a burst of economic growth, but just like the Making Work Pay tax cut in Obama’s stimulus package and the Bush withholding-tax reduction in 2008, the payroll-tax holiday failed to produce any such momentum in 2011.

Initially, another principled reason to oppose the president’s payroll tax cut proposal existed: He wanted to pay for it with a surtax on millionaires, which Republicans repeatedly resisted as a tax cut on job creators.

But, then, House Republicans had an idea: What if they gave the president his payroll tax cut extension in exchange for the Keystone XL Pipeline, a true job creation measure? They passed a bill that gave Obama the extension exactly as he wanted it — in yearlong form — on condition that he approve the Keystone XL Pipeline. The president said he’d veto the bill if it passed the Senate with the Keystone provision intact. That’s how beholden Obama felt at the time to environmentalists.

But as negotiations played out, Obama and Democrats came to their senses: They realized they wouldn’t lose the environmentalist vote if they approved Keystone. (What? Would enviros ever really vote Republican?) So they agreed to Keystone (and to spending offsets other than a surtax on millionaires) in exchange for the payroll tax cut. But, oddly, they negotiated a two-month tax cut instead of a yearlong cut. And, yes, by “they” I mean Democrats. In hindsight, it appears the two-month time frame was for the benefit of Democrats, not Republicans.

Why would Democrats want the two-month cut instead of the yearlong cut? Because they didn’t want to give the issue up as a political boon. It allowed them to criticize Republicans for hypocritically opposing a tax cut. They settled for Keystone and offsets in exchange for the ability to again bash GOPers over their opposition to the tax cut extension two months from now. For that, they depended on Republicans continuing to oppose the extension as bad policy.

The House didn’t want to play along. Thankfully for them, a study came out to demonstrate that a two-month tax cut would be unworkable, allowing them to focus on the timeframe, rather than the tax cut extension itself. They conceived of a new line that is conveniently consistent with years-old Republican rhetoric about the need for certainty in business and personal financial planning: A two-month tax cut extension is a source of too much uncertainty for taxpayers.

But here’s the problem: Whether it’s for two months or a year, a payroll tax cut extension is bad policy. (Have I mentioned that yet?) In the context of comprehensive Social Security reform, it might make sense to tamper with the payroll tax. But as a half-hearted, gimmicky gesture to pander to the middle class, it doesn’t. That is, it makes political sense — but not policy sense.

To me, this entire episode epitomizes the problems with Washington. Politics seemingly always trump principle. Again and again, politicians justify their support for bad policies with this defense: “If I don’t support this poor policy, I won’t be reelected because my opponents will use it against me. So, I’m going to support this poor policy so as to be reelected — and, then, I’ll implement sound policy.” But they never quite get around to the sound policy-making.

Unfortunately, we have nobody to blame for this phenomenon but ourselves. As Ann Coulter has put it, the problem is not with politicians. It’s that we, the people, want our treats. In this case, it’s the payroll tax cut extension. At some point, we’re gonna have to sober up and realize the solutions to our problems don’t lie in Washington: They lie in personal responsibility. Yes, these are difficult economic times, but that doesn’t mean now is the time to look to Washington for a handout. Now is the time to find the resources within ourselves to work more creatively or more energetically to make ends meet, to volunteer to help a hard-up neighbor (trusting that that neighbor will, in turn, help us in our time of need) and, above all, to remember that the spiritual has primacy over the material, not the other way around.

Blowback

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Good luck Cantor, dingy hasn’t done squat for three years to deal with the debt issue. What makes you think dingy will deal with this? dingy and bho want to blame you r’s for everything, don’t u know? bhopress is primed and getting their talking points as I post.
L

To me, this entire episode epitomizes the problems with Washington. Politics seemingly always trump principle. Again and again, politicians justify their support for bad policies with this defense: “If I don’t support this poor policy, I won’t be reelected because my opponents will use it against me. So, I’m going to support this poor policy so as to be reelected — and, then, I’ll implement sound policy.” But they never quite get around to the sound policy-making.

You got it in a nutshell, Tina. The above quote should be used as the basis for the new series, “Schoolhouse Rock : The 21st Century”. (“Episode 1 : I’m Just a Pol”??)

But here’s the problem: Whether it’s for two months or a year, a payroll tax cut extension is bad policy. (Have I mentioned that yet?) In the context of comprehensive Social Security reform, it might make sense to tamper with the payroll tax.

Every time you mention the fact that 47% don’t pay Federal Income taxes – the rejoinder is that they DO contribute Payroll taxes.

Now they want to absolve them of them those taxes.

More Socialistic Wealth redistribution as a National agenda (is that far enough of a separation for those two words, ernesto?)

Wealth redistribution that punishes success and reward dependency – why do we want more of that?

Republicans are going to be blamed no matter which way they voted. If they supported the 2 month extension, they would have been criticized for not getting a one year extension passed. This was a no win situation and passing tax legislation in 2 month intervals is lousy policy.

This whole payroll tax debate would have been a slam dunk for the GOP if handled by almost any warm-blooded human, but under Boehner the House is once again playing defense and being beaten up by Obama and the media. Is this a Boehner character flaw? The man has no ability to relate to the public or explain anything.

The real problem here is the voters. If the gullible (or ignorant) voters wouldn’t vote for those who just give away goodies, none of this nonsense would happen.

Ta111 on December 20, 2011 at 6:11 PM

Then we may as well stop voting altogether. They all give away goodies, and not to us. The Political Class (most politicians, Republicans and Democrats), and Crony Big Business. They exist for each other, they feed on each other, one can’t exist anymore without each other, and we, down here, don’t count anymore. Our ancestor founders would be shooting by now.

Yeah. You’re correct, of course.
But I think that you’re not really thinking like a politician, here.
Reid tossed the hot potato over to the House and skidaddled(sp? heh).
You are assuming that they really want to do what’s right for the country–not that the payroll tax is it.
In reality, it’s like Tina said in the article:

Why would Democrats want the two-month cut instead of the yearlong cut? Because they didn’t want to give the issue up as a political boon. It allowed them to criticize Republicans for hypocritically opposing a tax cut.

So, dems want to have this issue come up again in Feb 2012 so that they can batter the GOP over the head with it closer to the election. And repubs are trying to clear it away til after the election.

You and I would stay and get our work done. Our politicians…not so much.

Obama refuses to build the pipeline, says it is environmentally unsound.

Obama hammers the GOP for raising taxes on the middle class (union labor)

Obama gets the tax cut in FICA which is paid by labor.

Obama gets the GOP all in a lather, all screwed up, all discombobulated not knowing what the heII is going on.

Obama gets the news media hammering the GOP

Obama gets to explain how he is the champion for the working man, cutting their taxes, and making those evil rich pay for the poor working mans Social Security Retirement, because Obama has reduced the amount the working man pays into the fund without reducing the benefit.

Obama continues to spend money we don’t have. No one seems able to stop him. The Senate Democrats are invisible, it’s all the fault of the evil GOP. The Senate Democrats changed the deal with the House and went home, and it’s the fault of the House the bill doesn’t pass.

I say to the House. Shut down, turn off the lights and go home. (and don’t bother coming back in January, just let the democrats run things. Just stay home, you are not needed in Washington, you are not getting anything done, you are getting all the blame, just stay home, let the democrats run the government for the next year because you clearly have no idea what is going on in Washington.)

The cut in revenue to the Social Security fund expands the already-significant deficit between revenues and benefit payments in SSA, which means that more money has to come out of the general fund to cover the gap — and that means more deficit spending.

whoa!! Last August when Obama threatened to cut the SS checks it was shown that at that time SS took in about $55 billion/month more than it sent out. Could the repubs be trying to lower revenue to the general fund?

I don’t like blowing a hole in the social security funding mechanism UNLESS it is not being used for SS. Under that scenario cut away because they are not setting it aside.

If SS is currently at deficit and the dems want to maintain that then we have a whopper of a talking point.

Hey! Its my money, I’d like to keep it, OK?
A whole lot of good it will do to have me pay more to the gov’mt. T.E.A!

CUT SOMETHING DAMMIT!

They should have stuck to their guns and not passed the previous budget extension, STUPID REPUBLICANS. O what a predictably great job the stupid committee did. STUPID! I give them a 0% job approval rating.

But as negotiations played out, Obama and Democrats came to their senses: They realized they wouldn’t lose the environmentalist vote if they approved Keystone. (What? Would enviros ever really vote Republican?) So they agreed to Keystone (and to spending offsets other than a surtax on millionaires) in exchange for the payroll tax cut. But, oddly, they negotiated a two-month tax cut instead of a yearlong cut. And, yes, by “they” I mean Democrats. In hindsight, it appears the two-month time frame was for the benefit of Democrats, not Republicans.

i think you are not quite cynical enough Tina. Barry threatened to veto. Ok, so he and Reid got together to figure out how to get a pound of flesh from the Rs. So “give” them the pipeline, but wrap it in a poison pill…two months, rather than a year.

Now the House says yes to 2 months, and get pounded by the press/obama campaign for being grinches…or Rs say NO and then they get pounded by the press/Obama campaign for being..well, Grinches.

Voting………..every 2 years I need to renew my medical license. And I have to have a certain amount of “continuing education” to qualify……… I have no problem jumping through hoops to maintain the requirements that deem me worthy of affecting people’s lives. But I cringe when I think about the votes of the idiots that have control over my life. Sorry. Not advocating “continuing ed” for voting rights. However, since our educational system isn’t teaching them the rudiments, maybe it’s not such a stretch after all…….More wine Gromit…… Been a long day and pontificating relieves the stress..:-}

Unfortunately, we have nobody to blame for this phenomenon but ourselves. As Ann Coulter has put it, the problem is not with politicians. It’s that we, the people, want our treats.

Oh, bullsqueeze.

*Some* people may want that, but don’t adopt an inane version of “people don’t kill people, guns kill people” here. WTF exactly are you thinking when you say the politicians aren’t the problem? Yes, I know there are countless and too many sheeple out here who fit your narrative, but there’s a shatload of us who *don’t*, and I’m a bit tired of nincompoops lumping everyone together with that kind of nonsense.

I figured out a way to show my disgust with the GOP leadership in Congress.

Just imagine a loud beep going off covering up all the expletives..

Beeeeppppp__________________________________________________________________________________________________________and they also didn’t do __________________________________________but they could have stood up to Obama but they __________shinola_______________________________________________________.

Yes the tax cut is bad policy, it takes money from a system that does need it (we can’t reform it overnight) and dribbles it out at such a piddling pace that nobody is going to use it buy a ‘big ticket’ item, that might, just might spur some demand in the economy. But it’s the only ‘tax cut’ that Obama can think of that benefits the bottom 47% where his base lies. But on the other hand, looking at the history of policies that have come out of the legislative branch since the Dems took power in 2008, this almost looks like good policy.
Choose your poison, a year long extension, dubious at best at offering any net benefit, or a 2-mos. extension that is (1) unworkable and (2) probably do more damage in trying to implement? You’re going to get pummelled either way, you might as well get the Keystone Pipeline (or the propaganda against those who tie it up in court, and street cred for pushing it that far) and get the full year extension (of political value only).
The way I see it, the Republicans only lose if they blink first. Get the Senate back in DC the week after Christmas (or tomorrow!) and face them down.

I do not make a specific substantive comment on the issue of the 2 month tax cut or whatever TF it is because it will not help salvage and save America and as whatever TF it is it is chickenshit.

I do repost a related comment I made on Facebook where my Profile Page is in the same name as here John W Stevenson [with edition/addition]:

*

August 16 2011

It seems to me:

Congressman Eric Cantor [The House Republican Majority Leader although not The Speaker] is the only public official presently on stage who my basic gut feelings and instincts tell me would effectively handle the Office of President of the United States of America